A weekly industry survey held by the Mortgage Bankers Association has determined that home loan interest rates have dropped, prompting refinancing to climb to a three year high. Since 1990, the association's Market Composite Index has conducted a survey on mortgage applications, and as of September 28th, mortgage applications increased 16.6 percent from one week earlier. The Refinance Index increased twenty percent.
According to Mike Fratantoni, the Mortgage Bankers Association's vice president of research and economics, the markets will continue to adjust as "the Federal Reserve's initiative to buy mortgage backed securities pushes rates lower."
The interest rate for fixed-rate mortgages over thirty years fell from 3.63 percent to 3.53 percent for loans under $417,500, while loans above that jumped to 3.87% from 3.82%. The average rate for mortgages backed by the Federal Housing Administration dropped to 3.37 percent, while a 15-year fixed rate mortgage dropped to 2.90 percent.
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